There was an interesting article in the WSJ on August Â first describing the actions of housing activists in East Palo Alto, CA. It seems that the activists are very annoyed at Equity Residential, the REIT owners of a major apartment complex because delinquent rent notices are being sent out too quickly.Â The housing activists see this as an attempt to speed up evictions and take advantage of a rising rent market by obtaining higher rent from the next tenant than could be charges to the current tenant under the provisions of rent control regulations. They have turned their anger on the property owner and are painting the owners to be the â€œbad guysâ€. This is just another example of an entitlement mentality gone awry. The notion that property owners should not quickly enforce the collection of past due rent is bizarre and irrational. What the housing activists overlook is the simple fact that if a tenant pays the rent on time, when due, as agreed in the lease or rental agreement they signed, there would be no delinquent rent notice.
Most residential rental agreements or leases provide that rent is due on the first day of the month and becomes delinquent on the fifth (5th) day of the month (or 3rd day in some cases) referred to as the â€œgrace periodâ€. Under California law, a three day notice to pay or quit (vacate) must be served before eviction proceedings can commence but canâ€™t be served legally until the expiration of the â€œgrace periodâ€.Â The laws in California are among the toughest in the nation in terms of protecting the residential tenant and, superimposed on top of that are local rent control laws that provide even greater protections to the tenant. A tenant canâ€™t be evicted for the sole reason that their rent payment was late.Â Except in some very rare and special circumstance situations, if all past due rent has been paid before the eviction hearing in Court takes place, it is usual that the complaint is dismissed (the eviction does not go forward).
East Palo Alto, like some other Cities has a residential rent control law that â€œfreezesâ€ the rent for the current tenant with only statutory annual increases permitted. There is absolutely no argument that, in a rapidly rising residential rent market, it is advantageous for a landlord to have current rent controlled tenants vacate so new tenants can come in at a higher rent. But, that fact is irrelevant in relationship to the actions of housing activists.Â The mere receipt of a three day notice to pay or quit does not, in and of itself, force a tenant to vacate.Â The State of California, and not the landlord, is in control of the process after the expiration of the three day period. So, what is the â€œbeefâ€ of the housing activists?
The property owner stated that the â€œtimelyâ€ sending of three day notices to pay or quit resulted from installing a computer program to track late payments and automatically send the notice at the termination of any â€œgrace periodâ€. There is absolutely nothing wrong with that method of implementing the collection of past due rents.Â In fact, it is a standard business procedure among professional property managers. And, it shouldnâ€™t be overlooked that the tenant agreed, at the time of renting the unit, to pay on the date specified. Moreover, most prudent professional property managers are painfully aware of the high cost and complexity of an eviction (unlawful detainer) action and will work with a delinquent tenant to resolve the delinquent payment before commencing eviction proceedings. The East Palo Alto housing activists are not complaining about any unlawful eviction activity and, again, the California laws are so protective of tenants that they really donâ€™t need the help of housing activists.Â So, what is the â€œbeefâ€ of the activists?
The housing activists probably have no other current â€œcauseâ€ to promote in order to justify their existence.Â They might just as well complain that Safeway is wrong to insist on the payment for the bag of groceries before leaving the store. The demonstrations organized by the housing activists are childish and irrational and the people who take part (tenants or others) are equally childish.Â What the property owner is doing is absolutely not wrong from any viewpoint.Â There is no harm to anyone by demanding that rent be paid on time, as agreed, and that failing to do so will cause a notice to be served, which is no surprise based on most rental agreements or leases. What is disturbing is that the activists completely overlook the obvious.Â If the rent is paid on time, no notice will be served.
The activities of the activists are reminiscent of a time in the past when tenants formed â€œunionsâ€ to lobby for â€œtenants rightsâ€. In one â€œunionâ€ meeting one of the organizers said it is not about â€œrightsâ€ it is really about â€œcontrolâ€ over the housing supply. The landlord-tenant laws of today make â€œtenant unionsâ€ unnecessary and irrelevant. These housing activists should recognize that fact and find something useful to do instead of wasting everyoneâ€™s time on nonsensical issues.